AT&T is Moving Away From 2-Year Contracts Starting June 1

Once June 1 rolls around, it’s going to be harder than ever to sign-up for a new 2-year contract at AT&T and buy a phone at a low subsidized price. According to multiple sources of ours, the wireless carrier will begin transitioning to a world where contracts are on the backburner and AT&T Next is the option that will be presented to you when it’s time to upgrade and your previous contract has ended. In some cases, it will be the only option you have, unless you feel like waiting a few extra days for your brand new phone to arrive.

On June 1, AT&T will no longer offer (at least up front) 2-year contracts for service at Local Dealer and National Retail Locations. Your options to upgrade to a new phone and sign-up for service will be through AT&T Next, because the device payment plan approach is what “aligns with what customers want” at this stage in the game. AT&T also feels that AT&T Next simplifies choice and provides additional savings when combined with their Mobile Share Value plans.

What if you don’t want AT&T Next and would rather sign a 2-year agreement? Local Dealer locations will still technically be able to sign you up for a 2-year agreement via Direct Fulfillment, which is like them placing an order for you in store and then shipping the device to you a few days later. In other words, you wouldn’t see your new phone for a couple of days in some cases. You will also be able to sign-up for 2-year agreements at Company Owned Retail locations, customer service, and att.com. Other than that, AT&T Next is your option and will be the option presented to you.

On a related note, 2-year agreements will still be available for tablets, basic phones, Internet of Things devices, and in some bundle offers.

Of course, the move away from contracts isn’t new to the industry – T-Mobile did away with them a couple of years ago. AT&T, like T-Mobile, is just tweaking their money making machine, so that it makes money through device payment plans instead of by tacking on undisclosed device fees into service contracts when you buy a discounted phone through a subsidy. Still, this model, I think most would argue, is better for customers than 2-year contracts.

Again, once June 1 comes around, many of the AT&T stores you visit will no longer offer 2-year service agreements with discounted phones. Instead, sales reps will move you to an AT&T Next plan, where you won’t have upfront costs for phones, but will have both service and device payments.

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Jerry Mitchell Crihfield Jr.

Does this mean I can get out of my current 2 year agreement?

Chris M

VZW is next…around same time

Lou1234

If you are on the mobile share plan with 10gb which most people and families are. If you do the next program your line is just 15 bucks, but on a contract its 40. So if you get an iphone on a 2yr for 199.99 plus you pay 25 extra per month for the 2yr thats 800. On the next program your only paying 650

Rpak

First understand that both options have pros and cons and the way you purchase the device is yours. The whole point is buying options. How would you like it if the carriers quit subsidizing as well as took away leasing or installment options. Then your left with full retail of the device. You think a family of 5 is going to upgrade to an iphone 6 16gb at $649.99 plus tax a piece upfront in store. Quit griping about the way you get to purchase your device. Just be glad you dont live in a country where this is reality.

Danny

Actually May 31st will be the last day to sign up for a two year contract on AT&T. I work at Best Buy Mobile. We were told that come June 1st two year contract options will not be available at all in corporate AT&T store as well as third party retailers. AT&T Next will be the only available upgrade option for smartphones. Two year contracts for basic phones will stick around.

Unless they stop people from being able to “upgrade” to a contract plan in an Apple Store they will still have plenty of idiots bitching about why their phone bill shot up after they got a new iPhone for $200.

Mick

Whatever you want to call it AT&T Next is basically a big rip off . why pay full price for your phone over 24 months period and still be paying a subsidy to your carrier all this time? Sounds like a cash cow. Double dipping. Next is NOT the same as contracts. ITS LIKE LEASING YOUR PHONE UNTIL PAID IN FULL.

Lou1234

If you are on the mobile share plan with 10gb which most people and families are. If you do the next program your line is just 15 bucks, but on a contract its 40. So if you get an iphone on a 2yr for 199.99 plus you pay 25 extra per month for the 2yr thats 800. On the next program your only paying 650. So 2yr contract is more of a rip off

matti861

as a person who works there I love this. I hate getting ignorant customers in the store who just cant grasp the concept of the fact that they are getting a subsidy on their rate plan, want a discount subsidy on a phone, and want their bill to remain the same lol. This is a more streamline way of doing it and people don’t have to change unlimited if they dont want to

willv

Or, you could sign a 2yr contract for an s6 @$199, pay the 325$ etf the next month, and walk out under 600$ full retail. That makes more sense than the next program.

Lou1234

but then you lose your number and have to get a new one. to some people their number is worth more then 50 bucks

BoltmanLives

Wow you mean finally people will not be fooled into paying full MSRP and Higher data because they are too dumb to figure it out?

Yes people your phones so cost $600-800 or $1000 if fanboiis

Guest

Why so serious

BoltmanLives

Best thing to happen its great! Love it

NExt sucks so now you will all see the true price of phones .

summit21

I fail to see the savings difference. My wife and I are currently on the 2 year plan. Monthly bill is $122 (2 smartphones 4GB data, and a tablet). This same set-up on ATT Next is going to cost me $127. So it is not cheaper. Both factor in my employer discount of 22%.

WickedToby741

It’s not necessarily a cheaper price, but it is a more accurate price. By separating the phone cost from the plan cost, if you pick a cheaper phone you pay less and if you pick a more expensive phone you pay more. Previously, you could pick a 128 GB iPhone 6+ or a Moto G and your monthly cost would be the same. The only difference was the upfront cost.

Lou1234

yes but for 5 bucks more you get 2 brand new top of the line phones and you get the option to upgrade sooner

Psyc

The 4GB plan is retired, the $70 plan is now the 6GB.

Paddy

So, you’re basically screwed out of a 2 year plan if you break your phone and need an immediate replacement. Otherwise you can still get a 2 year contract very easily. Personally, I strongly prefer buying online anyway as it’s easier to compare and price. So, if you want a 2 year contract, don’t break your phone and or be willing to wait a couple days if you do.

WickedToby741

Um, how so? I don’t see how this is different if you break your phone. You break your phone, you have to buy a new one at full MSRP unless your old one is paid off. Previously this was when your contract was up.

Paddy

That’s not really what I was getting at though, so my bad for not being clear. My assumption with the above situation was that let’s say someone had a phone for 2 years and 1 month, wasn’t planning to get a new phone yet, and then dropped and broke the phone. Their choice on June 1st will now be to order a phone on a 2 year contract and wait a few days for it to be shipped (no phone for a couple days might or might not be a deal breaker) or they can go get their phone that same day with the Next program (maybe enough convenience to convert a few more people).

A number of studies are starting to show people are trying to hold onto their phones for longer periods of time now, so there is definitely a demographic where this might come into play. My point though is that there is probably a very limited number of people who will be impacted negatively (in their eyes) with this new change, but they are definitely out there.

And even so, I’m not convinced those people who are trying to hold onto their phones longer will be impacted negatively as they’d be the most likely to just keep their phones after they’re paid off while still getting $15-25 off their bill a month for being on Next. I don’t know the exact break even point, but they’d probably save money over what they have now by holding onto their phones for 3-4 years on Next.

K Rad

well here come $950 smartphones to keep unlimited data. Verizon customers, at least we can do installment plans, you guys just get screwed completely.

Zacharypt

Are you referring to installment plans to keep unlimited data on Verizon? The DPP (Device Payment Plan) was sunset a while ago.

Duffman

This is an AT&T article… You talked about VZW below aswell.

Zacharypt

My bad, I did read the syntax wrong on that. I thought he was referring to Verizon Customers being able to do installment to keep unlimited. That was an option. And its not a mistake talking about EDGE, I understand AT&T’s NEXT plan well. Being that Verizon is part of the duopoly I felt it was applicable to look at the other side of the argument since Verizon will respond at some point to this.

Rennis Deynolds

I’m not exactly sure what the big issue is with contracts. Could someone point me in the direction of an explanation of why people seem to hate the so much? Is it a freedom/updates/no bloatware thing?

For me contracts allow me to purchase my device at a cheaper price than buying it outright and seem to be a better option than paying off the full retail price over the lifetime of the phone with something like an Edge plan. Furthermore, I don’t really feel comfortable dropping $500-$700 for something with a relatively short lifespan. I know root, etc. can extend device lifespan but for some older people (my parents lol) this is simply not an option.

Zacharypt

Rennis, Keep in mind that if you are on newer mobile plans (mobile share/more everything) that you get a monthly credit for not singing a device contract. Speaking for Verizon and EDGE in this case on the More Everything plan the credit is $15 for data plans 4GB or lower and $25 for plans 6GB and higher. Typical price per mo on EDGE for a flagship device is $25/mo ($600 phone). So You either net pay $240 (over the course of 24 months) with EDGE (on a 4GB or lower plan) or $0 (on a 6GB or higher plan). THat same phone on a 2 year contract is $200 plus contract fees ($40).

(That’s a negative sign, meaning you saved more than you paid for the phone)

The plan cost is irrelevant assuming you need that much data. If you don’t need 6GB or more, I suggest finding other responsible people, getting on the same plan and getting up to the 6GB level to save the extra money with the extra edge discount AND splitting the cost of the bill.

Before my company discount on AT&T I pay $39.95/month per line and each line gets 3GB. Some lines never use more than 1 so the power users get to take advantage of that. By the way that number includes all taxes.

Zacharypt

I am curious Mkader17, have you seen sale prices from carriers on the full retail cost? I haven’t yet from Verizon but that would be amazing!

MKader17

I bought my Moto X for $350 from Moto. My Dad bought his Moto X for $400 through AT&T. If the carrier isn’t cheaper, go somewhere else. I don’t recommend financing, but if you feel you must SOMEONE will give you 0% interest for these days (CC, Paypal, etc).

Guest

In The U.S. people feel locked into their carrier
An Early Termination Fee prevents some people from leaving
Some people do not like to buy subsidized smartphones
Keep in mind monthly service for wireless carriers (i.e. mins,text, data) has not gone down

Zacharypt

“GUEST” I think it is fair to say prices have been going down on service.

Guest

You mean for a wireless monthly plan including taxes and fees
Even after paying full retail for a smartphone?

Zacharypt

Verizon’s prices have been moving lower since August. Especially with the 6GB being the threshold for full retail phones (and being outside of contract). There is some confusion where people feel like if they are in an existing contract and they buy a full retail phone their plan should drop. However, the price drop is contingent on not having any contracts on a line.

K Rad

If your on a grandfathered plan, yes you do get a discount and your service costs the same. If your on the more new Mobileshare plans, 95% of the time Next is cheaper.

AC

I’m more or less with you, Rennis. But if you are an individual, going the AT&T Next (or Verizon Edge) isn’t worth it assuming you are okay with staying on AT&T for two years. I haven’t looked at all the math on this site, but it is pretty simple overall and doesn’t add up. Despite what the article says (“Still, this model, I think most would argue, is better for customers than 2-year contracts.”) I think I would argue that the 2-year contract is better for most individuals, albeit ever-so-slightly. I’m assuming a 3GB plan here since most individuals are fine with that–maybe not all readers of this blog, but it doesn’t change when you jump to 6GB anyway. You need to jump all the way to the 15GB plan because that’s when AT&T knocks off $25/line for the device access charge instead of just $15. The math:

Sure, on the 3GB plan a 2-year contract only saves you $125, but that’s still savings. Almost covers insurance for your expensive phone. But maybe $125 is worth it to avoid a contract, even though you probably aren’t planning on leaving your carrier anyway.

And, like someone else pointed out, if you can get a deal on your phone somehow and bring your own, then you can save more (assuming AT&T allows this, I don’t know). But if you are going to bring your own phone, why bother with AT&T anyway? Just go use Straight Talk or Cricket and really save some money. More math:

Frankly, the only time I’ve seen AT&T Next or Verizon Edge plans that made any sense, it was some 4-line family plan deal that I can’t get. But this is assuming you don’t like to pay extra to upgrade your phone more often… (though I think you still have to wait 24 months for the AT&T Next 24 that I priced above).

“You will also be able to sign-up for 2-year agreements at Company Owned Retail locations, customer service, and att.com. Other than that, AT&T Next is your option and will be the option presented to you.”

What am I missing here? It sounds like nothing is changing.

K Rad

Thank you!

Paddy

You can’t walk out of the store with a new phone on a 2 year contract. It has to be ordered and shipped.

TheSimpleTruth

Ah I see.. Not that big of a deal IMO. I’ve done that for most flagship phones I’ve gotten. Big Red is pretty good about overnighting them.

Paddy

There is a break even point for the Next program to become worth it (probably in the 24-36 month range for most. If you’re someone who can live with the same phone for an extra few months, it does actually save money long term because there will be a number of months where you don’t necessarily need to trade the phone in for a new installment. Also, if you’re someone who does want a new phone after 12-18 months, it’s also the best option. However, if 24 months is that sort of perfect moment to get a new phone, it’s probably best just to keep with the 2 year contracts.

Phones are sort of in plateau mode though, so the advancements probably won’t be as rapid as they were say 3-4 years ago. I’m starting to view phones similar to how I view PC’s, I try to get as much time out of my PC before it either isn’t working well or let’s say the motherboard finally fries, which has me leaning toward joining next. I’ll definitely recommend crunching the numbers in a calculator though.

Perhaps I’m misunderstanding how it works though. I just don’t see it as ultra sinister.

Mordecaidrake

If Verizon does this I’m screwed. I don’t want to switch to a carrier with worse service but I would have the option of unlocked phones. Verizon, not so much.

ClikFire _

Rocking a Verizon Nexus 6, it is unlocked.

Mordecaidrake

Yes, but I also don’t wish to have a tablet for a phone.

ClikFire _

I came from using the Nexus 5 for a year it didn’t take long to adjust now 5 inch phones feel tiny like I am using a toy trust me once you go big its hard to go back I might be able to go down to 5.5 maybe 5.2 but even then that is pushing it for me. Once You text on a big screen its hard to go back because it feels crammed.

EdubE24

I looked at getting the S6 and would be coming from a 6 Plus. After playing around with it for a few minutes I knew that I couldn’t go back to a smaller phone.

Mordecaidrake

I can’t do bigger than the Moto X 2014, I don’t want to have to 2 hand my phone.

Tony G.

I feel the same. I bought a Turbo a month before the N6 from Motorola. After I got 5.1 in March I used my VZW sim. I can’t go back to a 5″ now I don’t think.

ClikFire _

Next, Jump and Edge = Still a Contract.

If I went to a concert and the parking was free but the tickets cost money but then the next year parking cost money and the concert was free nothing has changed.

FknTwizted

hopefully this will force manufactures and carriers to have equipment to have all antennas in it (ie nexus 6). That is one of the reason i bought the n6 so if i feel like switching i can just jump ship or if i go to a different country more and likely i can just get a sim card from a local carrier.

Godzilla

This is why pure editions or GSM unlocked phones are important and you should buy them up front. You can move between TMO and ATT at will and maybe project FI in the future.

Matt Gondek

This makes sense and all, with the caveat that they would lower the plan prices since they no longer have to bury the device fee from the subsidised contract in there. Which I highly doubt.

Duffman

So… what does this mean for those of us on unlimited data plans? My friend at AT&T says he can “transfer” my unlimited data to a Next plan, but if I recall, they weren’t able to do such thing when Next first came out (it’s shared data only). I was hoping to sneak getting my G4 on contract… bastards had to put this in place riiiiight before the launch.

They do allow unlocked phones on their network, it’s just that almost none of them support their CDMA bands. When they go full VoLTE, then maybe it won’t be an issue, but I suspect they’ll still have it locked down somehow to where it won’t be as easy as using one on any other GSM network.

T4rd

I expect a “Verizon is Moving Away From 2-Year Contracts” article in the next few weeks as well then to (further) confirm the duopoly partnership. =p

Disqo Stu

Customers want 0 down, pay later unfortunately.

Rick J

They can still get that on a NEXT 24 plan.
I just went back to AT&T from T-Mobile a couple of weeks ago.
Did a Next 24 plan with 10GB of shared data. No money down… just had to pay the taxes on the device up front.

hiulupop

I pay $33 per month with unlimited talk and text. 10gb shared data between 6.

Arthur Dent

Cool story bro

hiulupop

I think you missed the second part of the story because for some reason i got distracted and never typed it.

second part: So this deal is the worst for me. I would rather buy a Moto X for cheap and save money

ultravisitor

Unless you have an individual bill from AT&T that is for $33, then I’m not sure anyone cares.

bjrapp

I came here to downvote all the people claiming that over two years, NEXT makes you pay more than a 2-year contract. *cracks knuckles* Shall we begin?

sc0rch3d

“aligns with what customers want” …..doesn’t even deserve a rant. total BS. Please ppl, save your pennies, buy unlocked, and stay off a contract.

yankeesusa

Yep, you have plenty of phones to choose from. Unlocked moto x 2014, nexus 5 or nexus 6, oneplus one, even the new zen phone 2 that just came out. Plus sometimes you can get phones like the g3 or s6 unlocked for under $500.

Zacharypt

what is the full retail price difference between new unlocked and NEXT/EDGE

Sam

Another way to make more money:….
Current Plan you get phone for $100 to $200 with 2 year contract.
New Plan would cost $20 to $30 more per month (ie $480 to $720 over 2 years
At the end we pay $380 to $520 more per year. I understand that you are out of contract but lot of us that doesn’t make a difference since we are planning stay with that company anyway. If this was for customer, why take it away. Just let us make the choice.

You forgot the discount you get for being on next. I forget what it is exactly, but it’s something like $15-$20 less per month.

Arthur Dent

$25 if you are on a 10GB plan I think

Rick J

$15 per device now for 10GB plans and above.

n900mixalot

Verizon is promoting 10 gig plans with 15 per device now. Just saw the commercial. But 80 bucks plus 15 per line … yikes …

Rick J

Love it when competition actual brings prices down.

n900mixalot

I’d like to see them double that data for the same price … T-Mobile still has the best data offering … but ugh, until I move to the city (never going to happen) or they fill in the gaps with at least 3G (…) I can’t partake in their fortuitous data orgy.

Rick J

Agreed… I just left T-Mobile to go back to AT&T. I held out for a little over a year, but T-Mobile hasn’t done anything in my state to improve service, so I went back to old reliable. I was only saving about $20 per month being with T-Mobile, so going back to AT&T wasn’t all that painful.

jimt

Plus taxes and fees.

capecodcarl

I laughed out loud when Verizon promotes 10 gigabytes shared data plans like it is a massive amount of data. My son would blow through 10GB of data in a couple of days streaming Netflix on his tablet.

ah that works for high data plan users. How much would i save if I have 2 GB plan? I am guessing you still pay more with next. My point is why not give us choice. We as customer will make the decision. They are taking away that because they want you to believe this is better for you but it isn’t for everyone.

Alex

You are paying the same price for the phones as you would unlocked, most of the time. It’s just a no-interest payment plan.

In return, they discount a chunk off of your bill to make up the fact that don’t have to build in that global subsidy.

Xavier_NYC

Anddd I will be buying unlocked phones going forward. I don’t want to do any Next plans and if I’m going to pay full retail for a phone I don’t want any added carrier crapware and slow updates..

El_Big_CHRIS

True, and I wonder if the plans are going to be cheaper since now people are paying for the device fill price

Indianajonze

lol good one

El_Big_CHRIS

Yeah I know, wishful thinking. This is the biggest problem, carriers double dip by now making you paypay Full price and same plan prices, I wouldn’t mind paying full price but the plans (data) need to be cheaper

Paddy

The benefit is if you are ok staying with a single phone for a few years before upgrading. If you are content getting a phone and keeping it long term until it doesn’t work anymore, it’s actually not a bad deal because you won’t be paying anything on the device after 12-24 months whereas your price stays the same on a 2 year contract. Or you can just buy it outright I guess.

Cael

I’m pretty sure ATT has the highest priced devices out of the 4 carriers. So it balances out I guess

They are since you get that $15/$25 a month discount. Basically means your phone is “free” depending on which phone you have.

Cory Wilson

They did get cheaper. At first next was a ripoff and was added on top of the subsidy you already paid. At&t then started adding $25 discounts per line for no contract or next lines. So basically if you switch to next you end up breaking even pretty much. $25 discount per line + anywhere from $15-$30 per phone you buy with next. And you can pay it off in full early if you desire.

It overall is a better deal than contracts. Just sucks there’s no option to pay money down to get a lower payment

Dale

If I had the money I’d certainly buy unlocked phones too. If not just for the faster updates.

Cool, thanks. I’ll have to check out the financing options when the Note 5 comes out.

Xavier_NYC

No problem. Also newegg.com is pretty clutch. Just took a look at some of their prices for unlocked models and its not that expensive. Only thing you need to worry about is making sure the phone model is compatible with your carrier. Here’s a good site for checking that: http://www.willmyphonework.net/

Guest

Cool thanks

closingracer

Not really “faster” unless your getting nexus. Samsung isn’t exactly the fastest with updates even if you don’t add the added time for carriers like Verizon and etc. also you lose LTE if you ever switch carriers or possibly none depending on phone. Apple iPhone 6/6 plus and the nexus 6 are one of the few phones who has all the LTE bands in the United States.

Xavier_NYC

You guys and your nexus comments are getting annoying. Yes we get it, the Nexus 6 is a great phone and get updates fast.. That’s nice.. You’re actually wrong, the international and global versions of most devices gets updates sometimes months in advance because it doesn’t have to go through carrier testing etc. Also International and Global versions work perfectly fine with carrier LTE, ever heard of XDA? They have threads and people that have tested the devices on carriers and none of reported issues outside having to get a new IMEI or change APN settings but in most cases they work out of the box. Just have to be smart enough to make sure they phone you order has the correct LTE bands inside the phone. For me that would be bands 2/4/5 and 17 for AT&T

closingracer

I’m not wrong and that’s that. Android 5.0.1 didn’t show up on HTC phones until late November or so , Samsung Galaxy S5 around December , and Note 4 around January or February I think ? Most unlocked devices don’t have LTE bands for AT&T, Verizon , sprint AND T-Mobile. As I said the only phones that does are the nexus 6 and iPhone 6/6 plus and perhaps a few others ? An unlocked phone with only carriers bands is useless for me and faster broken updates isn’t enough of a reason to get a unlocked device.*

You want “fast” updates you get nexus not some other device because it’s still not “fast” but a decent wait

* yes Android 5.0.1 is broken imo and should update directly to 5.1 instead of going for 5.0.1 like I know Samsung has done with their note 4.

Xavier_NYC

That’s because you’re comparing OEM’s with multiple devices vs google that really only focuses on the Nexus line. Once again you are wrong, I am on XDA and there’s Galaxy S6 variants that work perfectly fine on AT&T and Tmo. They LTE speeds and MMS just like normal AT&T phone. The only thing they don’t get is VoLTE which I don’t care about and Wifi Calling which is only on Tmo and I have AT&T. You just need to know what bands your carrier supports. AT&T needs bands 2,4,5 and 17. These are the LTE bands in the international G920i(Galaxy S6) (4G FDD LTE

And you wanna talk about broken updates LOL. Nexus owners are pretty much ginny pigs for the new versions of android. Lets be serious, memory leak issues ring a bell? Battery issues ringing a bell? Most android skins fix those issues.

closingracer

Yay you’re on XDA ? Want a medal ? I don’t give a s*** . I am also not wrong . Cool one band out of multiple works between t-Mobile and AT&T? It’s still useless unless you happen to live in that area that uses both. T-Mobile band 12 is where it’s at as terms of reliability which is their 700mhz block they got from Verizon. The 700mhz is what AT&T uses and which t-Mobile doesn’t support AT all since it’s different bands of the 700mhz frequency. Also I want a phone that supports ALL networks not the crap called t-Mobile and expensive AT&T

Broken updates ? Samsung has updated their phones TO the broken update ….smh

Xavier_NYC

ARE YOU F*CKING RETARDED? I just posted all the LTE Bands that AT&T uses.. U know what, you have a good night sir. I’m not gonna go back and forth with an idiot.

closingracer

Cool AT&T bands ? Yay? Only way it’s a good reason for people to buy unlocked devices if they have bands for every other carrier in the United States which as I said before only the iPhone and nexus 6 is capable of doing so.

Cory Wilson

As a nexus owner updates are overrated. You end up just being a beta tester for everyone else and a lot of the features Google adds are already a part of the OEM skins anyway. If you want a nexus it should be either your a developer or you want a good no contract option. And you most certainly should consider a one plus one or moto e/g/x as well.

Xavier_NYC

Yeah I like all of those phones and I personally think stock android is boring so I prefer skins as long as they aren’t overwhelming. I’m using the Note 4 and even tho TW isn’t great, I just slapped nova on it and did some minor tweaks and it works perfectly fine for me.

ThomasMoneyhon

The pure edition moto x 2014 actually got some updates faster than a nexus. plus it looks great with wood or leather and isn’t as big as the nexus 6. doesn’t cost as much either.

ClikFire _

if you sell your current flagship the difference you pay for unlocked is only $300-400 for a $600+ dollar device or if you don’t mind using last years flagship every year you can find the Galaxy S5, HTC One M8 LG G3 all for around $300 or lower on swappa, ebay and amazon.

Or if You are like me and my Wife we use part of our Tax return and your current device to pay for a new phone every year.

MKader17

I buy unlocked phones because they are WAY cheaper than a 2 year contract and they retain their value better because the amount of people that can use them is much better.

DanSan

bought my nexus 6 full price for a reason. sucked it up and dropped the $700 to make sure i future proofed myself. Im on verizon so that usually pigeon holes your choices once you switch but now i can bring it anywhere. not stuck having to rebuy a GSM phone

Also keep my unlimited data

Xavier_NYC

Considering I don’t plan on leaving AT&T anytime soon unless they pry my unlimited data out of my cold dead fingers, I’m fine with that. If I did leave I’d prob get tmobile because Verizon doesn’t play nice with other phones not sold by them. Plus if I got a Global/Intenational version of a phone I’ll be fine as long as the LTE Bands for my carrier, the phone will work fine between AT&T and Tmo.

Iz Zoo

Do they slow down your Internet speed alot if u go over 5gb? I have unlimited also and it drives me nuts when I use 6 or 7gb and they slow it down so much there is no point in using the data

Xavier_NYC

Unfortunately yes but from my understanding they will stop doing it and actually let people use their unlimited data. But that’s me being hopeful

zeth006

You got the best of both worlds really. No bloat, no contracts, and unlimited data on the best network.

At some point, I may go a similar route with T-Mobile. I haven’t been on a contract in 8 years anyway.

michael arazan

Same here

Only wish Verizon would drop the subsidy payment hidden in their bills, been off contract for way over a year and my bill has not changed.
Feel like I’m paying the subsidy fee to Keep Unlimited

Cory Wilson

Yeah I got 2 nexus 5’s for me any my wife on my at&t plan. My total bill is $200 and that’s with U200 TV and 24mb home internet combined with my 15gb mobile share value plan. Upgraded from nexus 4s and the plan going forward was to buy new unlocked nexus phones then eBay the old ones and end up with a very contract like upgrade fee. Google then announced the expensive nexus 6 and threw a wrench into the plans

Keith Taylor

I am ok with 2 year agreements. Its just simply for me that way.

uhuhu

vvujvv

jonzey231

“AT&T, like T-Mobile, is just tweaking their money making machine, so that it makes money through device payment plans instead…”

T-Mobile doesn’t make money on their device payment plans. If the phone is $499.99 + tax, then you pay what the tax would be up front and they will split the $499.99 over the course of 24 months at 0% Interest each and every time. They are just giving you a way to pay off the phone without having to pay the manufacturer directly. They’re making money off service, early upgrade programs like Jump!, and accessories.

Looks like you are not taking advantage of their loss, why pay less, when you can pay more?

Daniel Grabowski

Don’t get me wrong, I love what T-Mobile is doing. I just don’t see it as a long term viable business. They are going for the bulk number of accounts, with less profit per account, but there’s just not enough people switching over.

jimt

Nothing to lose in the mean time except your money.

yankeesusa

I wouldn’t take gizmodo too seriously on their info. But that could be the case.

n900mixalot

Ever since that demon creature started working for them back in 2008 or so, I threw Gizmodo in the trash. Kat Hannaford. Ugh, disgusting clone of a human being.

jonzey231

I’m not their financial director, nor do in own shares in the company; therefore, I don’t care if they’re losing money. If they continue to give me unlimited data, crazy fast data speeds and great coverage (at least in my city of Columbus, OH) then I will ride that train until the quality drops or they company how’s under.

I just don’t want this writer giving people the idea that T-Mobile is “making money” on devices. They may get that $499.99 device for $449.99 and mark it up $50 but this writer made it seem like a large portion of the earnings will be made through device payment plans and this article should be corrected to show that it just isn’t true.

ultravisitor

You should care whether or not T-Mobile is losing money. If they lose money, then the quality of service drops.

n900mixalot

It can’t get any worse where I am.

ultravisitor

If you have any signal at all, it can get worse: you could get nothing.

Wudien

you say they aren’t making money on the monthly payments, but go on to say they sell the phone at a higher cost than what they get. Gee wiz I think that’s the basis of making money. That’s a %10 markup for every device sold.

Dave12308

They must be doing alright, this article you linked was from January and they don’t seem to be slowing down the uncarrier thing. I don’t believe what I read on Gizmodo anyways, they are iOS fanboys over there.

ultravisitor

January wasn’t that long ago. The point is that what T-Mobile is doing is not sustainable over the long term. Let’s see how things look for them in about a year and a half.

They don’t sell phones at cost, they make money on full retail and installment purchases.

Rick J

T-Mobile makes plenty of money off their devices… first, they aren’t selling you the device at cost, so they make money there. Second, they charge on average almost $20-$30 more than other retail stores charge for the exact same phone.

Dave12308

And their Nexus 6 is currently $100 less than anyone elses

Rick J

Which is really shocking, but then again, they won’t sell you the device without buying at least one month of service.

MKader17

Yes, but they also are giving you 0% interest. In business the time value of money is real. They are losing ~3% on inflation every year. So when they front the money for you they are losing some of that profit over the next 2 years.

Paddy

Inflate the price of the phone and make money back with the actual service. The reason they like 12-24 month contracts is because it guarantees them a revenue pool from that person for a long period of time. The rest of the pricing is about making money long term while competing with competitors.

Keith Taylor

No thanks.

Tyler Durden

And with their new next deal you can pay the subsidized price up front and pay even more just to upgrade in 1 year! Woooooo

ClikFire _

exactly people think this is different than a contract but honestly its the same dang thing in fact its actually worst than a contract, people are so gullibale

Yup, I agree. With a 2 year contract you could leave anytime, just pay the ETF. That ETF is basically the same thing as when you want to leave early with a payment plan, where you have to pay the rest of your phone off anyways.

Danish

It is different.. you can pay the remaining balance of the phone whenever you want, say a day after you get it, getting it unlocked, and releasing you from obligation

With Next you can upgrade after 12 months versus the contract where you’ll have to wait 2 years.

Guest

Is that $25 dollar fee if and including smartphone monthly access data fee for At&t Mobile Share Value?

Dale

Yes. On the mobile share plans it’s a $15 access fee for Next phones and $40 access fee for contact phones. This applies to 10gb+ plans. Access fees are $25 a month for a Next phone if your plan is less than 10gb.

ClikFire _

The catch with these programs though is you need to have good credit otherwise you don’t qualify.

One thing Is for sure Consumers are starting to shift from buying a new phone every 2 years to every year though.

Paddy

I’m not sure how that works exactly. If you’ve been a customer for years and haven’t had late payments, will they really check your credit other than doing a basic soft pull. I’d imagine they do that for 2 year contracts when you initially sign on as well (sure they don’t want people signing a 2 year contract who are going to stop making payments within a few months.

MKader17

This is not the same as a contract. Anyone with half a brain should be elated that this is the new structure. AT&T has effectively split the plan away from the phone. AT&T is giving people a 0% interest loan for a phone. Personally, I will never use the next plan and believe it is stupid to take out a loan on something that depreciates so rapidly, but now that AT&T has separated it I save money!

Paddy

It is a contract, but it’s different in how it works. And it’s not necessarily worse than a 2 year because their are available discounts to help and you can get a discount once the installment finishes off you main bill (win for people who like to keep same phone for a long time). It has disadvantages as well, but to deny the advantages is a bit short sided to perhaps just being afraid of something new.

Brian Menius

I’ll LOL when Verizon finally does this as a means to kick people off UDP. That’s an overall minor impact to a small number of people in the name of the greater good, IMO. When there are no contracts, I expect that the market will be forced to compete on price. Outside of Verizon, there may be more churn, but it should prove more favorable to the consumer long-term.

Suicide_Note

Thank TMo for changing the game here in the US and A.

Scrippsjhon

It’s simple to make acount balance with droid-life < I didn't believe …that…my brother woz like truly making money part time at their computer. . there aunt had bean doing this 4 only seventeen months and resantly paid the dept on there apartment and bourt themselves a Lotus Elise .

Next is exactly like contracts in fact it is no different its just done in a different way that is extremely deceptive.

Justin Rogers

Exactly how is 0% APR on a loan for a phone deceptive????

Don’t get me wrong I agree in the end it works out basically the same as two year contracts.. But at the same time its not deceptive.

trwb

It’s just about the same. Instead of having a contract on service, you have a contract on a device that you owe money on that you are leasing with option to buy. The best way is to do things is no contract on anything and a device off of swappa, ebay, or a low cost unlocked phone.

Danish

But you can pay the phone off whenever you want, releasing you from any obligations to service… basically like just buying the phone full price online.

closingracer

And you can on sprint easy pay , Verizon edge or AT&T next and you’ll get a discount. I was laying around $130 a month after you includes taxes , phone payments , insurance and added tablet for t-mobile unlimited 4G data at $70 vs $80 what it is now. I was paying $10 more for the tablet. Verizon I was paying $144 for 10GB and added tablet after including all the phone payments and taxes. Sprint is actually the cheapest for unlimited data if your willing to lease your phone

Iz Zoo

But they have the worst service. I would so move to sprint if they had better service

closingracer

Meh I get good enoug service for was less money. $80 a month vs $130+ with t-mobile and Verizon

matt

Only $88 with Verizon on granfathered unlimited everything plan.

closingracer

Cool? Still can’t get it now so it’s useless for new customers

JLV90

Only an idiot would trade in the phone before it’s paid off can get a lot more money selling it yourself. at the point AT&T wants you to trade in the phones they are nearly 75% paid off.

Corey Watford

Not always true, lets just say you have the Next 24, own it in 24months, trade it in at 18months, really for 6months more you gonna pay around another 150bucks (adv next phone is $25/m * 6months = 150bucks) if you had a Galaxy S4 18months ago, your better off trading it in now, as 150bucks your saving, is about the going price of that used phone at 18months anyway, maybe you sell it after 6months of paying , but for how much… $200bucks, then you really only profited 50bucks, but hey thats your call.

JLV90

Next 24 you trade in at 24 months and own it at 30 months. The Next program has confusing names for everything but the number is when you are eligible to trade in for upgrade.

Corey Watford

Ya your correct meant Next 18, but my points still is valid

closingracer

An idiot ? I would do it over wasting time on eBay or craiglist. Yeah you’ll get more money out of it but your point ? I don’t like eBay because you have people who don’t actually pay for the item they purchased thus making me wait until I can report it to re post it , and other issues including all those fees PayPal and eBay takes. Craiglist has its own issues. Trading it in saves all that trouble at the very least

Well I certainly don’t disagree that trading in your phone is a poor financial decision but people make poor financial decisions all the time.

closingracer

It’s not a poor financial decision because it’s what you value out of it. Do you want a hassle free experience with simply trading the phone in early to get a new phone early or do you want the money? If you don’t like eBay hassles , their fees or deal with Craigslist you’re going to value the money less

Which is why I suggested Swappa, I’ve sold a phone on Swappa before and it was easy money. Yes they took a $25 (flat rate) fee) but I still got a lot more than if I traded my phone in.

closingracer

You get to buy a new phone if you trade in your phone on next …. I’m not talking about trading in for credit which is dumb

TylerCameron

Swappa has a flat $10 fee. Big deal.
The SLIGHTLY extra effort is worth not getting ripped off.
In most cases, a carrier won’t give you more than, say, $400 for an iPhone 6 in immaculate condition. In contract, you can sell them for $550+.

closingracer

First off I’m not talking a out trading phone in for credit. I’m talking about trading it early to upgrade early on AT&T Next or etc. 2nd screw selling it on ebay, swappa, or Craigslist. I’ve had plenty of people who say they will buy it but never show up or pay up

Bryan Prime

First. No you dont own anything. Unless you biy it right from the manufacturer. If you sogn a 2 year contract you dont own anything untill the contract ends. Same thing as financing cause you get a discount on the monthly service.

If you buy a phone under contract you do own it but you will have to pay the ETF if you cancel service before the contract ends.
If you finance the phone via AT&T Next or whatever you don’t own it until it’s paid off but after that you own it.
You can also pay full price for the phone and you’ll get the same service discount you’d get if you financed via Next.

Mick

True . it’s like someone who keeps leasing a car just to get a new one every so often and never owns it. Just a waste of money.

MKader17

Whatever, it is a beautiful way of handling it for the consumer.

In the old days when your contract was up and you didn’t get a new phone you were losing money every month. Now, When you are done paying off your phone that payment disappears. If you buy your phone out right to begin with you never pay for anything more than your service and you are not required to stay with them!

If you want to switch carriers you cancel your service, pay off your phone and you are on your way (or you pay nothing if you bought your phone outright). It’s not an ETF because you agreed to pay full price for a phone with a 0% interest loan. If your phone isn’t worth what you owe, that’s called depreciation… welcome to the real world.

This business model will drive the price of phones DOWN in the long run as more consumers will see up front what they are actually paying. It makes it less complicated, which will reduce costs.

Mick

Did you know that you are paying for your phone say in 30 months and all this time a subsidy in the service contract? So you’re paying twice for it. I work for a phone company on the inside.

MKader17

It’s unfortunate that you are on the inside and still don’t understand the business. If you own your phone (or on Next,Edge,etc.) you pay less per month than if you are on a contract. Simple as that. If you are talking about old plans then sure, but those are long gone, except for those that “need” unlimited.

closingracer

It’s the same amount of deceptive as what T-mobile been trying to shove down people throats for the past few years. The end result is your paying the same amount give and take but they are charging you for the device each month instead of hiding it …. T-mobile ain’t no savior and they suck like the rest

Cory Wilson

What annoys me about next is there’s no making your payments smaller. You can’t put money down and get a lower payment. You have to pay by their terms,and you can’t pay money into it either, it’s either pay it all off in full or pay your minimal payment. Pretty half assed loan setup.

I agree that overall it’s just a rewording of contracts, but don’t see much deception due to the fact that if you sign up for NEXT you get a $25 discount per line which pretty much breaks even with what it would cost subsidizing a phone for 2 years. I just don’t see why I can’t pay more money down for a lower payment.

Corey Watford

Well at least it doesn’t have any interest

Joel Luna

You will soon. They are launching a payment plan very soon.

ThomasMoneyhon

They would have to since they can’t have you pay a deposit if you fail the credit check. Deposits were for two year contracts and forcing a customer to pay a certain percent of the phone up front supplements that with installment billing. Verizon already offers this. It’s just catching up for att.

Andrew

I work for AT&T, there will be a new AT&T Next program call AT&T Next 12 with down payment, it gives you the option to upgrade after 12 payments, and you make about a 30% down payment on your phone, the payments to actually own the phone will be spread out over 28 months

Mick

This is false advertisement. Read the fine prints. It’s a lease plan. You would never own UNTIL paid in full. If you terminate the agreement early you paid early termination fee and the phone goes back to them. If you upgrade before the contract is met the phone also goes back to them .Where is the logic in all this?

Just like anything else you make payments on you have to pay it off before it’s yours free and clear.

If you are on a next plan an you terminate service before it’s paid off you will have to pay the balance due on the phone but you most definitely won’t have to pay an ETF. They only way you’d be forced to pay an ETF is if you converted one of their old family or individual plans to a Mobile Share Value, even though you got a lower bill your original contract remains in full force.

Not true, if you are on a contract plan your phone bill is $25 per line per month more expensive and you pay that extra $25 even after you are off contract.

With a Next plan you pay for your device over time and when the device is paid off the payments automatically go away. And at the end of 2 years you will have saved ~$200.

Nunyur_Biznezz

It does not work out exactly like a contract. A 2 year contract on say a iPhone 6 is $200 plus a $40 upgrade fee. So $240. A iPhone 6 on Next is $650 but if you’re on a 10 GB plan you get $25 a month off. So over 24 months that’s $600. So essentially the iPhone costs $50. $240 is not the same as $50. 2 year contracts are for suckers

USAgent

Yea Im switching carriers, we have had att and cingular and bellsouth for years, good by at att.

bose301s

My wife was basically told this earlier this month when we were looking at an S6 for her.